In the first part of the session, I'll go through a certain topic and today I'm going to talk about Google Ads smart bidding.
Okay, so let's move on to the topic for today. Where is it? Google's... I've called this how smart are you because a lot of people when they do use smart bidding and the smart campaigns, they don't use it the smart way. They jump right into it and they don't get the results. Hopefully, I'll give you some little tips and advice as to how you can make the CPA. That's the target cost per acquisition. What that acquisition depends on your conversion tracking. An acquisition could be someone fills in a form on your website. It could be anything which you are targeting as a conversion and this is mostly mainly used for lead generation as to how much are you prepared to pay for a lead.
What you do is you set up a Target TCPA and tell Google that I'm prepared to pay 10, 20, 50, 100, or whatever that number may be then the algorithm is going to go out and get that conversion, or quite often you will find and I see this a lot that people or somebody has set up and you need to give Google enough budget to be able to maneuver the campaign in the right direction first of all and then get you those conversions because it's going to do some kind of testing. You know, it won't quite a few times but Google is going to average it out to your target cost per acquisition or the cost targeting 50. If I was you I would put in at least a 250-pound budget saying that 50 pounds CPA there was a currency multiplied by four or five. You might feel a bit nervous to bid so much but if Google is giving you that conversion at that price and spending that budget then you should be able to scale it up because what you want to do is to make sure that the conversions which you get as a lead then get converted into sales. Now not every lead will convert into sales. You might have a 50, 60, 70, or you may have a 10 conversion rate. You do your maths. You do your sub for an acquisition.
The good thing about this kind of campaign is the headache of bidding keywords and all that. You don't need to... well, keywords you need to target but the bidding especially is taken out of your hands. You don't need to worry about it. Google is going to bid aggressively in front of those who it thinks is likely to convert and bid less who thinks it's not going to convert and then you get that average cost per acquisition. Once I get that target TCPA, ideally you don't want to see that red warning sign in your campaign.
The next one TROAS targets return on ad spend. How much are you getting back when you spend any budget or money on ads. This bidding is mostly used for e-commerce stores or websites. If you are selling a physical product like a camera or a tripod or a microphone or whatever, you will not be bidding on TCPA. TCPA is for lead generation. The ones that the TROAS has are for e-commerce. Every time you, let's say you're getting a 300% return on ad spend, what that means is 3x. Take out your cost of goods, take into consideration, how much you're spending on acquiring an order, and then work out how much your profit is. Again, the budget is the key. If you give very little budget, it's not going to run and these campaigns require a fair amount of leeway with regards to the budget. Otherwise, you will find that you hardly get any impressions or clicks, and obviously, if you don't get those two, you're not going to get any, a minimum.
Let's say if you're working this game. When you're giving one to Google and Google gives you three in return, you're not going to stop after giving away a hundred dollars and tell Google don't give me any more money. You'll say okay take my thousand or take five thousand or ten thousand as long as I keep getting that PX return. With TROAS, well, once you hit that number, you keep on scaling slowly. Slowly but don't be... don't jump from let's say if you're spending 100 a day to 1000 a day and you get excited, "Oh my god, I'm getting 500% TROAS, I'm going to increase my budget 10 times," is going to screw up the algorithm and the campaigns and you'll find that it goes into learning mode or something happens which nobody knows what happens inside Google's algorithms or the mind and then you'll wonder why is it not running.
The way I would do that is to have small incremental increases. If you're spending 100, go to 125 and after a few days 150, 200 and so on. Don't take big jumps, otherwise, your campaign is going to suffer. Maximize conversions is what as it says on the tin. It's going to maximize the... it's going to go and get as many conversions as it can for your budget. You don't need to spend or allow 4 to 5x the budget of your CPA or the ROAS. It's going to optimize for the conversions and it will probably and it usually does of your campaign instead of targeting a specific CPA. This kind of bidding is really good if you want to get the conversions in as quickly as possible because you know that you got a really good funnel in the back end which is very profitable.
Even if you are getting the conversions at a higher price, are you're prepared to pay for it? The Google algorithm is going to maximize your conversion value. What it's going to do is to bid more aggressively in front of those people who Google knows are the high rollers or the high spenders or the luxury buyers or whoever. Google knows more about us with these various data points than we know about ourselves. It knows exactly who we are, what we do, works it out, and maximizes the conversions as much as possible. Now the biggest mistake which I see everyone make is starting the campaigns right off the bat with smart bids. What I would recommend you do is start manual bids slowly. Slowly build up your data.
The machine knows what we are looking for as a conversion value or as a conversion, is going to spend less time in that eligible learning mode and you will find it very frustrating when you go straight in with zero data because the machine is learning. It's in learning mode and when it is in that learning mode, I would highly recommend that you don't touch it. Don't keep going in there, keep fiddling with the campaign, changing things around because every time you change something it's going to reset, and then it's going to take even more longer. Let it be. Let it do its job. Sometimes it takes a few days, sometimes a few weeks but you need to be patient so this is why I say to you that get the data in first and then go to smart...
eCPC, enhanced cost per click, this is obviously, but then Google is going to enhance increase or is likely to or not likely to convert. What you can also do is put a cap on the maximum CPC because it can go and spend two hundred dollars a click and you might think "Oh my god, just one click has cost me my whole day's budget," so make sure that you do put in a maxim bid because Google can quite easily go and spend in that niche. The cost, the clicks are quite expensive and enhanced CPC is again going to be bidding very aggressively in front of your target audience to get that click. It does not look at the conversions. What it does is it wants that click to the ad to be shown and get the click to your website to maximize your conversions.
If you enjoyed this article, you may also like:
- Google Ads Smart Bidding
- What Is Quality Score & Ad Rank?
- Google Ads Target CPA Bidding
- Google Ads Bid Strategy Report
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